Updated 3/26
Shoe Carnival isn’t the kind of company that grabs headlines. It’s not reinventing retail or launching flashy ad campaigns. But for investors who care more about dependable income and shareholder-friendly management than hype, this small-cap footwear chain quietly checks a lot of boxes.
Based in Indiana, Shoe Carnival runs hundreds of stores across the U.S. and Puerto Rico, offering name-brand shoes at value prices. It’s a simple model, but one that’s kept the company profitable while many retailers have stumbled. And lately, it’s been making consistent efforts to return value to shareholders through a steadily rising dividend.
Here’s a deeper dive into what income-focused investors should know.
Recent Events
Over the past year, Shoe Carnival’s stock has taken a beating—down about 40% from its 52-week high. That puts it near the low end of its trading range, with shares recently changing hands at just under $22.
The weakness is mostly tied to softer retail trends. Revenue fell over 6% year-over-year, and earnings saw a modest dip as well. But those top-line challenges haven’t bled into the company’s core stability. Shoe Carnival remains solidly profitable, with decent operating and net margins for a retailer.
One of the more encouraging signs: the balance sheet is in good shape. The company holds over $120 million in cash, with a current ratio north of 4. That means it has more than enough short-term assets to cover any near-term obligations. Total debt is manageable, and there’s plenty of flexibility to continue funding dividends, even in a slower economic environment.
Key Dividend Metrics
🪙 Forward Dividend Yield: 2.73%
📈 Trailing Yield: 2.48%
🧮 Payout Ratio: 20.15%
📅 Upcoming Dividend: April 21, 2025 (Ex-Div: April 7)
💸 5-Year Average Yield: 1.24%
💰 Annual Dividend: $0.60
📊 Dividend Growth Trend: Positive
🏛 Cash Per Share: $4.53
Dividend Overview
Shoe Carnival might be relatively new to the dividend game, but they’re catching up fast. The current dividend yield sits at 2.73%, which is more than double its 5-year average. That’s a sign the company has not only been raising the payout but that the stock might be undervalued by traditional yield standards.
Management has kept the payout conservative, with only about 20% of earnings going out as dividends. That gives them plenty of room to keep increasing the payout, even if earnings stay flat for a while. For income investors, that’s the kind of margin of safety you like to see.
And the upcoming dividend date—April 21, with an ex-dividend date of April 7—makes it timely for those watching the calendar.
Dividend Growth and Safety
This is where things start to get interesting. The forward dividend of $0.60 marks an 11% increase from the previous annual payout. That’s meaningful growth, especially for a stock trading at a relatively low valuation.
What’s backing this growth is the company’s strong cash generation. Operating cash flow sits above $100 million over the past year. That’s more than enough to cover dividends, reduce debt, and reinvest back into the business.
Free cash flow also remains healthy, and with the low payout ratio, it’s hard to find a red flag here. Safety isn’t just about covering the dividend today—it’s about being able to grow it over time. On that front, Shoe Carnival appears to have more than enough runway.
Another plus? Insiders own over a third of the company. That means management has a personal stake in making sure the business stays on solid footing and continues to return capital to shareholders.
Chart Analysis
Current Market Cycle Position
Looking at the chart, SCVL is deep in a markdown phase. This becomes clear by the steady series of lower highs and lower lows following a prior distribution pattern. The 50-day moving average has long since crossed below the 200-day average—a classic death cross that confirmed the trend change several months ago. Since then, the price has continued to decline in a controlled but persistent downtrend.
There are no signs yet of a proper bottoming structure. Price remains under both key moving averages, and there’s no evidence of higher lows forming. The breakdown from the high near 46 has been orderly, but relentless, and the stock has now drifted to levels around 21.50—close to its recent 52-week low.
Volume Behavior
Volume has been rising recently, particularly on red candles. That tells us sellers are still active and possibly even accelerating into this weakness. There are a few green volume spikes, which suggests attempted demand, but these have been met with renewed selling pressure. This kind of volume pattern often shows distribution still underway or fear-based selling into weakness.
The clustering of higher-volume red bars, especially over the past few weeks, confirms we’re not yet seeing the kind of quiet, tight price action that would suggest accumulation by strong hands.
RSI Indicator
The Relative Strength Index (RSI) has been stuck in low territory, barely reaching toward neutral levels for months. It recently hovered just above the oversold zone but couldn’t push much higher. That tells us momentum is still weak. And when RSI stays depressed over time like this, it tends to reflect a market that’s grinding lower with very little buying conviction behind it.
No bullish divergence is visible at this stage. Price and RSI continue to move in lockstep downward, offering no early signal that buyers are stepping in meaningfully.
Latest Five Candles
The last five candles have stayed in a narrow range between 21 and 22.5, with mostly small-bodied candles and frequent lower wicks. That’s a slight change from earlier action and could suggest that sellers are exhausting short-term, but the absence of any strong bullish candle or volume spike tempers that observation.
Some of the wicks underneath recent candles show there’s at least some buying interest near the 21 level. But it’s modest. There’s no aggressive move upward, and each small pop has been capped quickly.
This price action still leans heavy, and unless we see a clear shift with strong volume on a breakout candle or a sustained move above the 50-day average, the overall structure remains in markdown.
Analyst Ratings
📉 Shoe Carnival has recently experienced a mix of analyst sentiment, with both downgrades and upgrades shaping the narrative around the stock. Back in March 2024, one firm shifted its stance from buy to neutral. The reason? Concerns about the retailer’s ability to maintain growth momentum as competition intensifies across the sector. The downgrade reflected caution over softer revenue trends and margin pressures that had started to emerge in recent quarters.
📈 On the flip side, there was a more optimistic move from another firm that upgraded the stock from hold to buy. That call came with a price target of $40 and was based on a belief that Shoe Carnival’s internal strategies—like tighter inventory control and store-level execution—could help stabilize margins and support a recovery. Analysts noted that despite near-term headwinds, the company still had a clean balance sheet and strong operational discipline.
🔼 Later in the year, a separate update reaffirmed a buy rating and even bumped the price target from $42 to $51. That upgrade was driven by improving trends in store traffic and expectations that earnings could rebound more quickly than originally forecasted. It also reflected confidence that management’s cost control efforts were beginning to bear fruit.
🎯 As of now, the consensus price target across covering analysts sits around $33.50. The range is fairly tight, with high estimates at $35.00 and lower-end views closer to $32.00. Even at the conservative end, that still points to meaningful upside from the current stock price, suggesting that while sentiment has cooled somewhat, analysts still see potential in the company’s turnaround story.
Earning Report Summary
Full-Year Results
Shoe Carnival wrapped up fiscal 2024 with a mixed bag of results. On the bright side, total sales were up by a modest 2.3%, which lined up with what the company had expected. Earnings per share came in at $2.68 on a GAAP basis, and when adjusted, that number nudged up to $2.72—hitting the higher end of management’s guidance. One standout area was the Shoe Station brand, which grew sales by nearly 6%. That part of the business seems to be gaining some solid traction. Another plus was the Rogan’s Shoes acquisition, which has been performing better than anticipated, both in terms of profitability and synergy.
Q4 Snapshot
Looking at the fourth quarter, things were a bit more muted. Adjusted earnings per share landed at $0.54, a touch below last year’s $0.59 but still a beat compared to Wall Street’s estimates. Total revenue for the quarter was just under $263 million, falling short of expectations by about $8 million. The most notable stat, though, was the 6.3% drop in comparable store sales. That was steeper than expected and suggests there’s still some softness in the overall retail environment.
What’s Ahead
CEO Mark Worden made it clear that the company isn’t sitting still. One of the big moves coming down the pipeline is a large-scale rebranding effort. Around 175 current Shoe Carnival stores will be converted into Shoe Station locations over the next couple of years. Once that’s done, more than half of the company’s total store count—over 430 in total—will carry the Shoe Station name. The idea is to lean into a brand that’s resonating more with consumers and hopefully drive stronger performance across the board.
Guidance and Market Reaction
For fiscal 2025, the company is guiding sales to land somewhere between $1.15 billion and $1.23 billion. That’s a bit under what analysts were hoping to see, and it reflects a cautious tone given the current retail climate. Even so, investors responded positively at first, with the stock ticking up slightly after the earnings release. Still, with shares down over 30% in the last year, there’s clearly some hesitation in the market about what comes next.
Overall, the company is showing it can stay profitable and think strategically, even as it works through some near-term challenges.
Financial Health and Stability
Financially, this is one of the stronger small-cap retailers out there. With over $120 million in cash, the company is sitting on a nice cushion. And while it does have debt on the books—just under $368 million—it’s not excessive. The debt-to-equity ratio is in check, and the company’s cash flow can comfortably support interest payments.
Liquidity is solid, and there’s no sign the company is overextended. Inventory levels aren’t bloated, and the current ratio of 4.11 tells us there’s little near-term pressure from suppliers or creditors.
Looking at value metrics, the book value per share is $23.88—higher than the stock’s current price. That alone puts the price-to-book ratio under 1, a rare find in today’s market and a potential sign that the stock is trading below its intrinsic value.
Valuation and Stock Performance
Let’s talk numbers. Shoe Carnival’s trailing P/E is 8.2, and the forward P/E is around 11.75. Those are low figures in just about any sector, but especially so for a profitable, dividend-paying retailer.
Its price-to-sales ratio is sitting at 0.50, and EV/EBITDA is just under 6.5. These are bargain-level multiples that might catch the eye of value investors who are also income-focused.
Yes, the stock has dropped sharply in the last year, but sometimes that’s where opportunity begins. The 200-day moving average is all the way up near $35, so this is clearly a stock that’s out of favor right now. But for dividend investors with a long-term horizon, those kinds of price dislocations can be useful entry points.
Risks and Considerations
No company is without risks, and Shoe Carnival is no exception. Retail is a tough business, and it’s highly sensitive to economic swings. A slowdown in consumer spending can hit sales quickly, especially for discretionary items like shoes.
Margins are always a concern, particularly when input costs rise or competition heats up. While Shoe Carnival has done a good job maintaining profitability, there’s no guarantee it will stay that way if costs start creeping up.
Another thing to watch: short interest. As of mid-March, over 26% of the float is shorted. That’s high. It doesn’t always mean something’s wrong, but it does reflect bearish sentiment among some institutional players. If sentiment shifts, the stock could swing either direction in a hurry.
It’s also worth noting that both revenue and earnings declined year-over-year. While the company remains profitable, ongoing weakness in these areas could limit dividend growth if it persists.
Final Thoughts
Shoe Carnival isn’t a household name among dividend investors—yet. But for those willing to dig a little deeper, the story here is surprisingly solid. A 2.73% yield with room for growth, a conservative payout ratio, and a balance sheet that inspires confidence.
The valuation is cheap, the business is still making money, and the dividend growth is real. There’s no flashy branding here, no buzzword-heavy strategy. Just a low-cost operator doing its job and quietly rewarding shareholders.
For investors who prefer consistency over excitement and cash flow over speculation, this small-cap retailer might be worth a spot on the watchlist. It may not make headlines, but for long-term income, that’s often a good thing.